An LLC with either a single member or more than one member can
elect to be classified as a corporation rather than be classified as a
partnership or disregarded entity under the default rules discussed earlier.
File Form 8832, Entity Classification Election, to elect classification as a C
corporation. File Form 2553, Election by a Small Business Corporation, to elect
classification as an S corporation. LLCs electing classification as an S
corporation are not required to file Form 8832 to elect classification as a
corporation before filing Form 2553. By filing Form 2553, an LLC is deemed to
have elected classification as a corporation in addition to the S corporation
classification.

If the LLC elects to be classified as a corporation by filing
Form 8832, a copy of the LLC's Form 8832 must be attached to the federal income
tax return of each direct and indirect owner of the LLC for the tax year of the
owner that includes the date on which the election took effect.

Wanda and Sylvester are members of an LLC. They agree that the
LLC should be classified as a corporation but do not want to elect to have the
LLC be treated as an S corporation. The LLC must file Form 8832.

Evelyn and Carol are members of an LLC. They agree that the LLC
should be classified as an S corporation. The LLC must file Form 2553 instead of
Form 8832.

If the LLC is classified as a corporation, it must file a corporation
income tax return. If it is a C corporation, it is taxed on its taxable income
and distributions to the members are includible in the members' gross income to
the extent of the corporation's earnings and profits (double taxation). If it is
an S corporation, the corporation is generally not subject to any income tax and
the income, deductions, gains, losses, and credits of the corporation "pass
through" to the members.

Corporations generally file either:

Form 1120, U.S. Corporation Income Tax Return; or

Form 1120S, U.S. Income Tax Return for an S Corporation.

For more information on the income taxation of corporations and
their shareholders, see Publication 542, Corporations. For more information on
the income taxation of S corporations and their shareholders, see the
Instructions for Form 1120S, U.S. Income Tax Return for an S Corporation.